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LenaWriter [7]
3 years ago
8

Phips Co. purchases 100 percent of Sips Company on January 1, 20X2, when Phips' retained earnings balance is $320,000 and Sips'

is $120,000. During 20X2, Sips reports $20,000 of net income and declares $8,000 of dividends. Phips reports $125,000 of separate operating earnings plus $20,000 of equity-method income from its 100 percent interest in Sips; Phips declares dividends of $35,000. Based on the preceding information, what is Phips' post-closing retained earnings balance on December 31, 20X2?
Business
1 answer:
Taya2010 [7]3 years ago
3 0

Answer:

Phips' post-closing retained earnings balance on December 31, 20X2 = $577,000

Explanation:

Note: When 100% shares of a company is acquired it is treated as subsidiary and for its accounting equity method is used.

In that case all balances of subsidiary are added to balances of Parent company.

But if any dividend is received then such value is deducted from carrying value of investment, and any share in profit will be added to carrying value.

All the retained earnings balance is accumulated together of both companies.

Therefore closing balance shall be

Retained earnings balance of Sips at year end

= $120,000 + $20,000 - $8,000 = $132,000

Year end balance of Phips Alone

= $320,000 + 125,000 = $445,000

Total Retained Earnings at year end = $132,000 + $445,000 = $577,000

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When using a distributed workforce, collaborators are chosen based on competence and intentions. In this type of workforce, location is not important. They recruit people locally or internationally as long as they have the same intentions as the company and are willing to collaborate efficiently.
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3 years ago
A Nike Hoodie has a retail price of $99.00 and it costs the retailer $49.50. What is the mark-up
guajiro [1.7K]

Answer:

100%

Explanation:

Mark-up is the difference between selling price and cost price

Selling price =$99.00

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Mark up = $99- 49.50

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As a percentage

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3 years ago
In 2009, the worst recession in 80 years hit the United States, generally reducing household incomes. Despite this, profits and
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Answer:

These stores sell inferior goods and services.

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8 0
3 years ago
Read 2 more answers
Case Study: Melanie’s Breakeven Analysis Melanie is considering opening a not-for-profit child care and education center and wan
aliina [53]

Answer:

$800

Explanation:

Calculation for how much would she need to charge per month for tuition in order to break even

Using this formula

Amount to charge to break even=[(Monthly Fixed Costs+Salary and Benefits Costs+Estimated Food Costs)÷Number of Children Served]

Let plug in the formula

Amount to charge to break even=[($4,000+$7,000+$1,000)÷15]

Amount to charge to break even=$12,000/15

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Therefore the amount she would need to charge per month for tuition in order to break even will be $800

6 0
3 years ago
Ecolap Inc. (ECL) recently paid a $0.46 dividend. The dividend is expected to grow at a 14.5 percent rate. At a current stock pr
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Answer:

a) 15.69%

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= (Current year dividend ÷ current price) + growth rate

where,

Current year dividend = Dividend × ( 1 + dividend growth rate)

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And, the other item values remain the same

Now put these values to the above formula

So, the value would be equal to

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4 0
2 years ago
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